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Part three of our “Tough Times Call for Smart Measures” series. Refer to our previous blog posts for Parts 1 and 2.

How to Grow Your Restaurant the Cheap Way

A major asset that new restaurant operators have is the variety of inexpensive ways to grow a restaurant. Some tools focus on the marketing end and others focus on cutting costs in the kitchen. In the best of worlds, you can spread your efforts on growth across a variety of resources and follow these tips.

· Be willing to adjust: Don’t ring the same bell too many times. If something’s not working, there are many other marketing/purchasing opportunities to grow.
· Spread your attention: Don’t merely excel at social marketing or only pay attention to printing coupons. Mix it up to reach the widest audience.
· Work the phone: Challenge vendors to compete against each other and never be married to a single vendor.
· Get butts in the seats: Nobody wants to give anything away, but there’s a lot to be said for a new restaurant that looks crowded.
· Step out of your comfort zone: Trying something different is sometimes the best answer. Maybe you don’t know how to market to women, but a Ladies’ Night event can bring in a lot of new customers.

As is the case with your concept and menu, your low-cost growth efforts should be a reflection of your personality. Look around at what other restaurants are doing for a few new cost-efficient tricks up your sleeve.

Rewards Cards

Independents are at a disadvantage when battling against major national brands with a proven track record. Your best asset can be attracting return business, especially the kind of business you covet. Rewards cards are a great tool, letting you apply discounts for repeat visits or add credit based on a percentage of a total bill.

Make sure the cards themselves are classy—perhaps try a plastic credit card-like format with magnetic stripes for your POS terminals to read. Attach them to sectors you covet, such as a corporate card or a local business owner’s card.

Promotional Nights

Promotions are about marshaling word of mouth in your favor. Promotions are a great idea to find cheap ways to give people something to talk about. Promotions have to fit your concept. If you’re a fine-dining restaurant, make them a classy event. If you’re a pizza joint, make them family-oriented. If you’re a local independent, center them around a local event, such as a high school football game or a charitable cause.

Promotions that entail give-aways or reduced cost menus should go hand-in-hand with your vendors supplying you cheaper food/beverages. Hit up your suppliers for deals, or buy lower-cost proteins, liquor and wine. In the end, your promotions are mostly about enticing new guests and earning their long-term business. They’re not about one-time margin bumps.

Use Local Vendors

Local vendors are often looking for exposure. Offer your venue in exchange for reduced costs and you have a win-win. This may be a small return, such as pastry shop giving you cheap desserts to sell. But local vendors imply to your guests a local connection with the surrounding community. They signal local investment that can’t be found in a corporate restaurant.

Use Discounted Menus

Discounted menus have become pervasive in recent years, especially as a response to the challenges presented by the economy. Everyone from expensive steakhouses to mom-and-pops has tried discounted menus, and many of them have been successful.

Discounted menus should demonstrate value to be effective. They have to convey the same great food, service, and whatever else you’re known for, at a reduced cost. They should also have a catchy name and be well-advertised. They should make your guests say, “Hey, have you heard about Restaurant X’s “— —“ menu?”

Use Social Media

Believe it or not, Facebook and Twitter were created for people like you—the small business owner looking to grow his business without spending a dime. Facebook dovetails beautifully with this business because it’s the perfect platform to announce promotions, coupons, rewards cards, relationships with local vendors, discounted menus, or anything else on your mind. With social media carrying your torch, you’ll never have to buy a poorly viewed advertisement in a widely-ignored local newspaper again.

Whichever growth tools you use, be sure to stick with trial-and-error tactics and keep at it. This business offers ample opportunities to get the word out while keeping costs down.

How to Deal with Missing Inventory

Missing inventory can be the most frustrating challenge for a restaurant owner or manager. It’s difficult to imagine that people you bring into your business as employees are capable of stealing from you. Unfortunately, it’s a fact of this business that can plague any type of restaurant, regardless of the value of inventory or the type of surveillance methods that are in place.

The first step when learning of missing inventory is to do everything possible to eliminate the chance that it has been lost or misplaced. This can happen, especially in big kitchens with a large staff. The second step is to be sure of how much inventory is missing and how long it has been missing for.

It’s important to not assume that inventory has been stolen, even when it seems obvious. Misunderstandings can happen, such as when:

If you’re certain that you are being victimized by internal theft, it’s important to find the perpetrator and make sure it never happens to you again.

When Inventory Grows Legs

It’s a horrible feeling – you suspect someone is pilfering your inventory but you’re unable to prove it. Many instances of petty theft start and end this way. For this reason, it’s important to take a few steps to limit the chance you’ll ever have this feeling again. If you have inventory with legs, take a little time to develop a few strategies.

· Catch them in the act: Surveillance cameras, inviting inventory and a few friends can help you catch a thief in the act. Try recreating the details of the initial theft and see if it happens again.
· Empower employees: The easiest way to find a thief is to encourage your staff to police themselves. Many employees will rise the occasion, and may even out a colleague for the best interests of the business.
· Hold a meeting: Meetings aren’t always productive, but they can be when the subject is employee theft. Nobody’s going to out themselves in front of their friends, but a good meeting can put everyone on high alert.
· Ask around: It can be surprising what employees know about fellow employees.

Make Sure it Never Happens Again

A few strategies can go a long way toward avoiding employee theft. The most important one is to count your inventory as much as possible. Counting inventory makes sure that your management team has its finger on the pulse of your assets, and that you know how much of everything you should have. Regular counting can be a deterrent to employees, who know that missing product will be uncovered quickly.

A few more strategies include…

· Install surveillance cameras: They can be expensive but worth it for restaurants with valuable inventory. Many restaurants use fake cameras, and this isn’t a terrible idea, as they can be a strong deterrent.
· Be present: Employees are far less likely to take something when they know that management can be anywhere at anytime. On the other hand, employees are emboldened when they’re certain that they’re not being watched.
· Limit employee access: Keep the number of people who have keys, alarm codes and PC access to the smallest possible number. In most cases, the number of people who have these tools shouldn’t be more than three.
· Discourage giveaways: Employees can get into the habit of giving away products to boost their tips. This is especially true behind the bar, where keeping track of liquor is an inexact science, to say the least. Remind your staff that giveaways are for managers only.
· Limit employee meals: Employees can overstep their boundaries when making employee meals. Be sure that your staff knows what’s available to them and what’s off limits.

There’s no sure-fire way to avoid employee theft, but a few easy-to-start strategies make it possible to limit the chance that it can ever happen in your restaurant.

Also, don’t forget that Destination Restaurant Consulting is here to do all of these things and more for your business, so if you need help, don’t hesitate to call us at 1-800-653-8575 or send us a message through the contact form at www.destinationrestaurantconsulting.com

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